Kingfisher Airlines crisis blows over as employees agree to resume work

The 26-day deadlock in Kingfisher Airlines was resolved on Thursday with the management agreeing to pay four months salary dues by December end to the striking employees who decided to resume work with immediate effect.

"All our employees will resume work on Thursday, including the pilots and engineers. We will now on continue to work together," airline CEO Sanjay Aggarwal told reporters after holding separate meetings with striking pilots and engineers at the airport in New Delhi.

Engineers' representative Subhash Chandra Mishra said, "we are joining duty from today. We have accepted the management's proposal for a staggered payment of four months salary dues by December." A representative of the striking pilots also said they will resume work immediately.

Resumption of Kingfisher's flight operations may take at least three to four weeks as the airline has to get its suspended flying license revoked by the DGCA which also has to satisfy itself on safety issues as well as the viability of their financial and operational plans.

Under the agreement arrived at, the management, which was earlier offering only three months salaries, climbed down to accept the workers' demand for payment of four out of seven months' dues by December end.

The 26-day deadlock in Kingfisher Airlines was resolved on Thursday with the management agreeing to pay four months salary dues by December end to the striking employees who decided to resume work with immediate effect.u00a0

While the March salary would be paid within 24 hours, the April salary would be paid by October 31, May dues before Diwali in mid-November and June salary by December end.

The salary dues from July to September would be paid by March next year after recapitalisation of the airline, the agitating staff said.

The management also withdrew its circular asking the staffers to give a written undertaking before resuming duty.

All Kingfisher flights have remained suspended since September 30 due to the strike, followed by a lockout from October one and then suspension of their Scheduled Operator's Permit (SOP) or the flying license by aviation regulator DGCA.

The license of Kingfisher was issued on August 26, 2003, and is valid till December 31 this year.

The beleaguered carrier, which early last year had a fleet of 66 aircraft, now has ten -- seven Airbus A-320s and three ATR turbo-props. The airline is saddled with a loss of Rs 8,000 crore and a debt burden of another over Rs 7,524 crore, a large part of which has not been serviced for several months.

The airline would have to get all necessary clearances from the DGCA by submitting the airline's financial and operational plans to the satisfaction of the regulator, which would then take a decision on revoking suspension of the SOP and allowing the ailine to resume operations.

Kingfisher management top brass met the striking engineers and pilots separately here in a bid to try to break the deadlock in a bid to prevent any protests by striking staffers during the upcoming Formula One Grand Prix, in which airline promoter Vijay Mallya is involved.

Mr. Mallya, who co-owns the Sahara Force India team that is participating in the Indian Grand Prix, wanted to avoid any disruption by the agitating employees during the motor race.

Earlier, Civil Aviation Minister Ajit Singh said while salary was "a big issue and the employees should be paid, the bigger issue than that is the airline's fiscal assurance to the DGCA... They have lot of outstandings to the Airports Authority (of India), to companies, to lessors, so its not just a question of salaries to the employees."

He said their flying license, though suspended, is "still there but to allow them to fly again, the DGCA has to be satisfied on many more things." The airline has to present a viable operational plan to the DGCA.

Noting that the airline had not yet submitted any revival plan to the DGCA, Mr. Singh said, "It is not a question of me being hopeful or not, in my view, its a very difficult proposition but not impossible."